National Retail Properties (NNN) 8-K Record Third Quarter Operating Results

Exhibit 99.1

NEWS RELEASE
For information contact:
Kevin B. Habicht
Chief Financial Officer
(407) 265-7348	FOR IMMEDIATE RELEASE
	November 5, 2007

RECORD THIRD QUARTER OPERATING RESULTS

ANNOUNCED BY NATIONAL RETAIL PROPERTIES, INC.

Orlando, Florida, November 5, 2007 – National Retail Properties, Inc. (NYSE: NNN), a real estate investment trust, today announced record operating results for the quarter ended September 30, 2007, including a 36.2% increase in revenues and a 21.1% increase in funds from operations (“FFO”) per share compared to the third quarter for 2006. Additionally, the company announced an increase of 31.0% in revenues and a 17.4% in FFO per share for the nine months ended September 30, 2007 compared to the same period for 2006. Highlights include:

Operating Results:

• Revenues and net earnings and FFO available to common shareholders:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Revenues	$	47,783	$	35,084	$	134,218	$	102,446
Net earnings available to common shareholders	$	45,690	$	20,453	$	117,656	$	122,098
Net earnings per common share (diluted)	$	0.68	$	0.35	$	1.82	$	2.12
FFO available to common shareholders	$	30,872	$	21,917	$	91,963	$	70,048
FFO per common share (diluted)	$	0.46	$	0.38	$	1.42	$	1.21

• Investment Portfolio occupancy was 98.2% at September 30, 2007.

Investments and Dispositions for the quarter ended September 30, 2007:

• Investments:

• $140.2 million in the Investment Portfolio, including acquiring 30 properties with an aggregate 683,000 square feet of gross leasable area

• $15.6 million in the Inventory Portfolio

• Dispositions:

• 13 Investment properties with an aggregate 331,000 square feet of gross leasable area, with net proceeds of $53.6 million, resulting in a gain of $22.5 million

• 27 Inventory properties with net proceeds of $51.9 million

450 S. Orange Ave., Suite 900 | Orlando, FL 32801
(800) NNN-REIT | www.nnnreit.com

Investments and Dispositions for the nine months ended September 30, 2007:

• Investments:

• $544.6 million in the Investment Portfolio, including acquiring 193 properties with an aggregate 1,735,000 square feet of gross leasable area

• $47 million in the Inventory Portfolio, including acquiring five properties and funding $38 million of development

• Dispositions:

• 27 Investment properties with an aggregate 719,000 square feet of gross leasable area, with net proceeds of $114.6 million, resulting in a gain of $46.9 million

• 66 Inventory properties with net proceeds of $148.1 million

Capital transactions for the quarter ended September 30, 2007:

• Issued 479,780 shares of common stock generating $10.9 million of net proceeds pursuant to the Dividend Reinvestment and Stock Purchase Plan

• Issued $250 million of 6.875% senior unsecured notes due in 2017 generating net proceeds of $247.5 million

• Funded $4.6 million of equity investment in NNN Retail Properties Fund I, LLC, our unconsolidated convenience store joint venture with Crow Holdings

National Retail also announced 2008 FFO guidance of $1.94 to $1.99 per share, which represents a 4% to 8% increase over 2007 guidance. This equates to net earnings before any gains or losses from the sale on investment properties of $1.44 to $1.49 per share plus $0.50 per share of expected real estate related depreciation and amortization. This guidance is based on current plans and assumptions and subject to the risks and uncertainties more fully described in this press release and the company’s reports filed with the Securities and Exchange Commission.

“The third quarter saw a continuation of the outstanding year that NNN is enjoying, with a 36% increase in revenues and strong growth in FFO per share over 2006 results” said Craig Macnab, Chief Executive Officer. “Late in the quarter, we successfully completed the initial investment in our convenience store joint venture with Crow Holdings. We are on pace for 2007 to be another record year for NNN in FFO growth and acquisitions. In addition, we’ll have paid our eighteenth consecutive annual dividend increase.

“Given the challenges in the capital markets, we were also delighted to have completed our recent equity offering,” he added. “As a result, our balance sheet is strong and we are well-positioned for what we expect to be a healthy environment for sale leaseback opportunities. Our portfolio occupancy is robust at 98.2% and our 14-year average remaining lease term gives us a clear view of our long-term rental income.”

National Retail invests primarily in high-quality retail properties subject generally to long-term, net leases. As of September 30, 2007, the company owned 876 Investment properties in 43 states with a gross leasable area of approximately 10.4 million square feet. For more information on the company, visit www.nnnreit.com.

Management will hold a conference call on November 5, 2007 at 2:00 p.m. EST to review these results. The call can be accessed on National Retail’s web site live athttp://www.nnnreit.com. For those unable to listen to the live broadcast, a replay will be available on the company’s web site. In addition, a summary of any earnings guidance given on the call will be posted to the company’s web site.

Statements in this press release that are not strictly historical are “forward-looking” statements. Forward-looking statements involve known and unknown risks, which may cause the company’s actual future results to differ materially from expected results. These risks include, among others, general economic conditions, local real estate conditions, changes in interest rates, increases in operating costs, the availability of capital, and the profitability of the company’s taxable subsidiary. Additional information concerning these and other factors that could cause actual results to differ materially from those forward-looking statements is contained from time to time in the company’s Securities and Exchange Commission (“SEC”) filings, including, but not limited to, the company’s Annual Report on Form 10-K. Copies of each filing may be obtained from the company or the SEC. Consequently, such forward-looking statements should be regarded solely as reflections of the company’s current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. National Retail undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.

Funds From Operations, commonly referred to as FFO, is a relative non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by the National

2

Association of Real Estate Investment Trusts and is used by the company as follows: net earnings (computed in accordance with GAAP) plus depreciation and amortization of assets unique to the real estate industry, excluding gains (or including losses) on the disposition of real estate held for investment, and the company’s share of these items from the company’s unconsolidated partnerships.

FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies. FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the company’s performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure. The company’s computation of FFO may differ from the methodology for calculating FFO used by other equity REITs, and therefore, may not be comparable to such other REITs.

The company has determined that there are earnings from discontinued operations in each of its segments, real estate held for investment and real estate held for sale. All property dispositions from the company’s held for investment segment are classified as discontinued operations. In addition, certain properties in the company’s held for sale segment that have generated revenues before disposition are classified as discontinued operations. These held for sale properties have not historically been classified as discontinued operations; prior period comparable condensed consolidated financial statements have been restated to include these properties in its earnings from discontinued operations. These adjustments resulted in a decrease in the company’s reported total revenues and total and per share earnings from continuing operations and an increase in the company’s earnings from discontinued operations. However, the company’s total and per share FFO and net earnings available to common shareholders are not affected.

The company’s Investment Portfolio and Inventory Portfolio and statistics related thereto do not include properties owned by our unconsolidated joint venture, NNN Retail Properties Fund I, LLC.

3

National Retail Properties, Inc.

(In thousands, except per share data)

(unaudited)

	Quarter Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Income Statement Summary
Revenues:
Rental and earned income	$	43,956		$	31,672		$	123,132		$	90,033
Real estate expense reimbursement from tenants		1,348			1,088			4,062			2,794
Interest and other income from real estate transactions		1,344			631			3,501			3,682
Interest income on mortgage residual interests		1,135			1,693			3,523			5,937
		47,783			35,084			134,218			102,446
Disposition of real estate, Inventory Portfolio:
Gross proceeds		—			463			825			21,915
Costs		—			(355	)		(493	)		(14,799	)
Gain		—			108			332			7,116
Operating expenses:
General and administrative		5,230			4,356			17,497			17,974
Real estate		1,862			1,552			5,666			4,246
Depreciation and amortization		8,216			5,653			22,691			15,929
Impairment – real estate, Inventory Portfolio		128			—			128			—
Impairment – mortgage residual interests valuation adjustment		638			6,116			638			8,779
Restructuring costs		—			—			—			1,580
		16,074			17,677			46,620			48,508
Other expenses (revenues):
Interest and other income		(793	)		(836	)		(3,120	)		(2,667	)
Interest expense		11,882			11,781			35,426			35,054
		11,089			10,945			32,306			32,387
Income tax benefit		1,509			3,195			6,724			8,489
Minority interest		(92	)		1,546			243			(1,745	)
Equity in earnings (loss) of unconsolidated affiliate		—			(76	)		—			119
Earnings from continuing operations		22,037			11,235			62,591			35,530
Earnings from discontinued operations:
Real estate, Investment Portfolio		23,404			8,500			52,656			83,802
Real estate, Inventory Portfolio, net of income tax expense and minority interest		1,945			1,720			7,498			5,772
		25,349			10,220			60,154			89,574
Net earnings		47,386			21,455			122,745			125,104
Series A Preferred Stock dividends		—			(1,002	)		—			(3,006	)
Series B Convertible Preferred Stock dividends		—			—			—			(419	)
Series C Redeemable Preferred Stock dividends		(1,696	)		—			(5,089	)		—
Net earnings available to common shareholders – basic		45,690			20,453			117,656			121,679
Series B Convertible Preferred Stock dividends, if dilutive		—			—			—			419
Net earnings available to common shareholders – diluted	$	45,690		$	20,453		$	117,656		$	122,098

4

National Retail Properties, Inc.

(In thousands, except per share data)

(unaudited)

	Quarter Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Weighted average common shares outstanding:
Basic		66,796			57,999			64,545			56,920
Diluted		67,029			58,225			64,768			57,676
Net earnings per share available to common shareholders:
Basic:
Continuing operations	$	0.30		$	0.18		$	0.89		$	0.57
Discontinued operations		0.38			0.17			0.93			1.57
Net earnings	$	0.68		$	0.35		$	1.82		$	2.14
Diluted:
Continuing operations	$	0.30		$	0.18		$	0.89		$	0.57
Discontinued operations		0.38			0.17			0.93			1.55
Net earnings	$	0.68		$	0.35		$	1.82		$	2.12
Supplemental Information:
Percentage rent	$	181		$	59		$	779		$	569
Earned income from direct financing leases	$	1,276		$	2,338		$	4,861		$	7,096
Decrease in real estate classified as direct financing leases		(1,747	)		(3,100	)		(6,614	)		(9,376	)
Net direct financing lease adjustment		(471	)		(762	)		(1,753	)		(2,280	)
Accrued rental income (straight-line)		660			851			2,051			4,979
Net lease accounting adjustments	$	189		$	89		$	298		$	2,699
Net Inventory Portfolio gain on disposition	$	2,822		$	507		$	9,205		$	7,232
Capitalized interest	$	1,176		$	580		$	2,620		$	1,612
Scheduled debt principal amortization (excluding maturities)	$	398		$	427		$	1,300		$	1,597

5

National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)

	Quarter Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Reconciliation of net earnings to FFO and FFO available to common shareholders:
Net earnings	$	47,386		$	21,455		$	122,745		$	125,104
Real estate depreciation and amortization:
Continuing operations		7,573			5,235			20,886			14,451
Discontinued operations		70			207			291			1,914
Joint venture real estate depreciation		3			—			3			—
Partnership real estate depreciation		—			138			—			418
Partnership gain on sale of asset		—			—			—			(265	)
Gain on disposition of real estate Investment Portfolio		(22,464	)		(4,116	)		(46,873	)		(68,568	)
FFO		32,568			22,919			97,052			73,054
Series A Preferred Stock dividends		—			(1,002	)		—			(3,006	)
Series B Convertible Preferred Stock dividends		—			—			—			(419	)
Series C Redeemable Preferred Stock dividends		(1,696	)		—			(5,089	)		—
FFO available to common shareholders – basic		30,872			21,917			91,963			69,629
Series B Convertible Preferred Stock dividends – if dilutive		—			—			—			419
FFO available to common shareholders – diluted	$	30,872		$	21,917		$	91,963		$	70,048
FFO per share:
Basic	$	0.46		$	0.38		$	1.42		$	1.22
Diluted	$	0.46		$	0.38		$	1.42		$	1.21

Real Estate Disposition Summary

	Quarter Ended September 30,							Nine Months Ended September 30,
	2007				2006			2007				2006
	# of Properties	Gain			# of Properties	Gain		# of Properties	Gain			# of Properties	Gain
Reconciliation of gain on disposition between continuing and discontinued operations:
Continuing operations	1	$	—		1	$	108	2	$	332		3	$	7,116
Discontinued operations:
Investment Portfolio	13		22,464		5		4,116	27		46,873		11		68,568
Inventory Portfolio	26		3,647		17		399	64		9,877		43		4,125
Minority interest, Inventory Portfolio	—		(825	)	—		—	—		(1,003	)	—		(4,009	)
	40	$	25,286		23	$	4,623	93	$	56,079		57	$	75,800
Reconciliation of gain on disposition of type:
Inventory Portfolio:
Development	2	$	1,650		1	$	108	10	$	4,464		5	$	8,567
Exchange	25		1,997		17		399	56		5,745		41		2,674
Minority interest, Development	—		(825	)	—		—	—		(1,003	)	—		(4,009	)
Total Inventory gain	27		2,822		18		507	66		9,206		46		7,232
Investment Portfolio	13		22,464		5		4,116	27		46,873		11		68,568
	40	$	25,286		23	$	4,623	93	$	56,079		57	$	75,800

6

National Retail Properties, Inc.

(in thousands)

(unaudited)

Earnings from Discontinued Operations – Investment Portfolio:In accordance with Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets” (“SFAS No. 144”), the company has classified its investment assets sold and leasehold interests expired subsequent to December 31, 2001, the effective date of SFAS No. 144, as discontinued operations. In addition, the company has classified any investment asset that was held for sale at September 30, 2007, as discontinued operations. The following is a summary of earnings from discontinued operations from the Investment Portfolio.

	Quarter Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Revenues:
Rental and earned income	$	959		$	4,674		$	5,926		$	21,314
Real estate expense reimbursement from tenants		137			38			260			949
Interest and other income from real estate transactions		116			91			433			356
		1,212			4,803			6,619			22,619
Expenses:
General and administrative		—			2			(45	)		96
Real estate		56			80			258			2,688
Interest		—			(143	)		(3	)		1,816
Depreciation and amortization		70			207			291			1,925
Impairment – real estate		146			273			335			693
		272			419			836			7,218
Gain on disposition of real estate		22,464			4,116			46,873			68,568
Loss on extinguishment of mortgage payable		—			—			—			(167	)
Earnings from discontinued operations	$	23,404		$	8,500		$	52,656		$	83,802
Earnings from Discontinued Operations – Inventory Portfolio:
Revenues:
Rental income	$	1,479		$	2,643		$	6,538		$	6,646
Real estate expense reimbursement from tenants		129			71			590			221
Interest and other income from real estate transactions		95			—			140			—
		1,703			2,714			7,268			6,867
Disposition of real estate:
Gross proceeds		51,735			24,503			151,743			51,755
Costs		(48,088	)		(24,104	)		(141,866	)		(47,630	)
Gain		3,647			399			9,877			4,125
Expenses:
General and administrative		16			(30	)		40			23
Real estate		229			90			1,029			246
Depreciation and amortization		12			—			44			—
Interest		1,316			303			2,726			619
		1,573			363			3,839			888
Income tax expense		(1,190	)		(1,053	)		(4,587	)		(3,532	)
Minority interest		(642	)		23			(1,221	)		(800	)
Earnings from discontinued operations	$	1,945		$	1,720		$	7,498		$	5,772

7

National Retail Properties, Inc.

(in thousands)

Balance Sheet Summary	September 30, 2007		December 31, 2006
	(unaudited)		(Note 1)
Assets:
Cash and cash equivalents	$	26,443	$	1,675
Restricted cash		39,158		36,587
Receivables, net of allowance		6,162		7,915
Investment in and note receivables from unconsolidated affiliates		4,568		—
Mortgages, notes and accrued interest receivable, net of allowance		67,650		30,945
Real estate, Investment Portfolio:
Accounted for using the operating method, net of accumulated depreciation and amortization:
Held for investment		1,915,472		1,432,457
Held for sale		8,422		8,539
Accounted for using the direct financing method:
Held for investment		37,816		62,432
Held for sale		8,562		8,902
Real estate, Inventory Portfolio, held for sale		136,874		228,159
Mortgage residual interests		25,147		31,512
Accrued rental income, net of allowance		23,439		26,413
Other assets		40,977		41,249
Total assets	$	2,340,690	$	1,916,785
Liabilities and shareholders’ equity:
Line of credit payable		19,400		28,000
Mortgages payable		27,766		35,892
Notes payable – secured		22,500		24,500
Notes payable – convertible		172,500		172,500
Notes payable, net of unamortized discount		739,038		489,804
Financing lease obligation		26,041		26,041
Income tax liability		3,123		6,340
Other liabilities		50,428		36,105
Minority interest		2,154		1,098
Shareholders’ equity		1,277,740		1,096,505
Total liabilities and equity	$	2,340,690	$	1,916,785
Common shares outstanding		67,572		59,823
Gross leasable area, Investment Portfolio		10,386		9,341

Note 1: Amounts are derived from audited consolidated financial statements included in the company’s Form 10-K for the year ended December 31, 2006 reflecting reclassifications for discontinued operations within the Investment Portfolio.

8

Orange Avenue Mortgage Investments, Inc. (“OAMI”)

(in thousands)

In May 2005, the company acquired a 78.9 percent equity investment of OAMI for $9.4 million. The company’s 78.9 percent share of OAMI’s net cash flow has been over $21.5 million since May 2005. The following summary represents the balances related to OAMI included in the company’s Balance Sheet and Income Statement Summary:

	September 30, 2007		December 31, 2006
	(unaudited)		(Note 1)
Assets:
Cash and cash equivalents	$	173	$	823
Restricted cash		21,592		17,165
Receivables and other assets		4,363		5,246
Mortgage residual interests		25,147		31,512
	$	51,275	$	54,746
Liabilities:
Notes payable – secured	$	22,500	$	24,500
Income tax liability		7,437		9,480
Other liabilities		131		410
	$	30,068	$	34,390
Minority interest	$	1,703	$	1,217

	Quarter Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Revenues:
Interest income on mortgage residual interests	$	1,135		$	1,693		$	3,523		$	5,937
Interest and other income		257			378			1,389			1,181
		1,392			2,071			4,912			7,118
Expenses:
General and administrative		108			74			318			421
Amortization		51			66			166			199
Impairment – mortgage residual interests valuation adjustments		638			6,116			638			8,779
Interest		575			672			1,807			2,096
		1,372			6,928			2,929			11,495
Income tax benefit		551			1,381			2,010			4,076
Minority interest		(2	)		941			(486	)		637
Net earnings (loss)	$	569		$	(2,535	)	$	3,507		$	336

Note 1: Amounts are derived from audited financial statements included in the company’s Form 10-K for the year ended December 31, 2006.

9

NNN Retail Properties Fund I, LLC

(dollars in thousands)

In September 2007, the company entered into a joint venture, NNN Retail Properties Fund I, LLC, with an affiliate of Crow Holdings Realty Partners IV, L.P. The company owns a 15 percent equity interest, and the following summary represents the Balance Sheet for the joint venture. The company’s investment in the joint venture is included in the company’s Balance Sheet Summary under “Investment in and note receivables from unconsolidated affiliates.”

	September 30, 2007
	(unaudited)
Assets:
Cash and cash equivalents	$	1
Receivables		10
Real estate		30,611
	$	30,622
Liabilities and member’s equity:
Notes payable	$	18,330
Other liabilities		215
Member’s equity		12,077
	$	30,622

10

National Retail Properties, Inc.

Investment Portfolio

Top 20 Lines of Trade

		As of September 30,
	Line of Trade	2007 (1)		2006 (2)
1.	Convenience stores	23.8	%	15.4	%
2.	Restaurants – full service	10.3	%	9.4	%
3.	Drug stores	5.5	%	9.9	%
4.	Books	4.7	%	5.9	%
5.	Consumer electronics	4.6	%	5.8	%
6.	Sporting goods	4.4	%	7.5	%
7.	Theaters	4.1	%	—
8.	Restaurants – limited service	3.9	%	4.8	%
9.	Grocery	3.7	%	6.5	%
10.	Furniture	3.3	%	4.7	%
11.	Travel plazas	3.2	%	3.5	%
12.	Office supplies	3.1	%	4.2	%
13.	Car washes	2.5	%	—
14.	Family entertainment centers	2.3	%	—
15.	Auto dealerships	2.3	%	2.1	%
16.	Beer, wine and liquor	2.3	%	2.2	%
17.	General merchandise	1.9	%	2.6	%
18.	Home furnishings	1.6	%	1.8	%
19.	Equipment rental	1.5	%	2.0	%
20.	Automotive parts	1.5	%	1.6	%
	Other	9.5	%	10.1	%
	Total	100.0	%	100.0	%

Top 10 States

	State	% of Total(1)			State	% of Total(1)
1.	Texas	19.8	%	6.	Pennsylvania	4.3	%
2.	Florida	11.4	%	7.	Indiana	3.9	%
3.	North Carolina	7.3	%	8.	Colorado	3.6	%
4.	Illinois	6.0	%	9.	Ohio	3.2	%
5.	Georgia	5.0	%	10.	Missouri	3.2	%

Lease Expirations

	% of Total(1)		# of Properties	Gross Leasable Area(3)		% of Total(1)		# of Properties	Gross Leasable Area(3)
2007	0.2	%	3	82,000	2013	4.7	%	32	735,000
2008	1.1	%	16	257,000	2014	5.4	%	32	538,000
2009	2.0	%	25	470,000	2015	3.4	%	22	521,000
2010	3.3	%	37	394,000	2016	2.6	%	18	298,000
2011	2.4	%	21	347,000	2017	5.1	%	26	667,000
2012	4.2	%	35	562,000	Thereafter	65.6	%	593	5,226,000

⁽¹⁾ Based on annual base rent of $184,940,000, which is the annualized base rent for all leases in place as of September 30, 2007.

⁽²⁾ Based on annual base rent of $145,145,000, which is the annualized base rent for all leases in place as of September 30, 2006.

⁽³⁾ Square feet.

11